Neoliberal: "'We have to build more housing. We have to build more housing. We have to build more housing, and I will be relentless in my pursuit to get the job done.' 😍😍😍😍😍😍"
Neoliberal: "'We have to build more housing. We have to build more housing. We have to build more housing, and I will be relentless in my pursuit to get the job done.' 😍😍😍😍😍😍"
There were "economists" last fall telling us that the Trumpublican tax cut was going to raise real wages in America substantially and soon: Robert J. Barro, Michael J. Boskin, John Cogan, Douglas Holtz-Eakin, Glenn Hubbard, Lawrence B. Lindsey, Harvey S. Rosen, George P. Shultz, John. B. Taylor; Larry Lindsey and Douglas Holtz-Eakin; James Miller, Charlie Calomiris, Jagdish Bhagwati; Kevin Hassett; Greg Mankiw; and the others. The people who last fall were telling us that the Trumpublican tax cut was going to raise wages by boosting growth by a number they decided was 0.4% per year—get us an extra 80 billion dollars of prosperity each year growing over time—all did so by pointing to the investment channel: (a) the tax cut would make investment more profitable, (b) we would then have about 800 billion a year of extra investment, (c) the added production made possible by that investment would be 80 billion a year, (d) and eventually wages would rise. (a) has happened. (b) was supposed to take effect quickly—this year. But (b) has broken down: business investment "should" be jumping from 13% to 17% of total production. It is not. So far it has jumped from 12.4% to 13.1%—one-sixth of the jump we were promised:
This comes as no surprise: Paul Krugman: Tax Cuts and Leprechauns: "The immediate effect of cutting the corporate tax rate... a big fall in taxes collected from corporations...
Well, since capitalism delivers higher real wages than any other system we know about, how can you oppose it root-and-branch except by somehow claiming it is fruit from a poisoned tree?: Matthew Yglesias: "I would like to read an intellectual history of how exactly “slavery was a boon to economic development” became the leftist position, and “actually, slavery is a retrograde anti-growth system as well as an immoral one” (Marx’s view!) became the neoliberal sellout view:"
Alex Bell et al.: Who becomes an inventor in America? The importance of exposure to innovation: "Using deidentified data on 1.2 million inventors from patent records linked to tax records...
More and more it looks as though minimum wage laws—and unions—are positive second-best interventions that raise societal wellbeing by blunting the impact of employer monopsony: Kevin Rinz and John Voorheis: The Distributional Effects of Minimum Wages: "States and localities are increasingly experimenting with higher minimum wages in response to rising income inequality and stagnant economic mobility...
If you did not read this over at Equitable Growth Value Added a year and a half ago when it came out, you should go read it now: Emmanuel Saez (2016): Taxing the rich more—evidence from the 2013 federal tax increase: "In 2013, a surtax on high earners was levied to help pay for the Affordable Care Act at the same time as the 2001 tax cuts for high-income earners that were signed into law by President George W. Bush expired...
Not quite true. It is what the Left New Dealers' consensus was. They had lost power in the U.S. But enough of them made it across the Atlantic to do a lot of good: Daniel Davies: "If you like the German social, political and economic model, it's worth remembering that what it really represents is the consensus of American opinion on how to build a stable non-Communist polity if you were starting from scratch, circa 1945..."
1870: The Real Industrial Revolution?:: The most important fact to grasp about the world economy of 1870 is that the economy then belonged much more to its past of the Middle Ages than to its future of—well, of us, and what our successors eventually decide they want to use as an overarching term with which to label our age of fuel, machine, and digit.
Listening at the Amherst College graduation to: Morris Dees: One Nation with Liberty and Justice for All. It struck me that Morris Dees of the SPLC speaks not as a lawyer but as a prophet. But when he spoke of "forgiveness" and of Martin Luther King, Jr., I found myself thinking that he wasn't expressing what he wanted to say very well—certainly not nearly as well as Martin Luther King, Jr., had...
Martin Feldstein (1979): Introduction to The American Economy in Transition: "The post-[World] War [II] period began in an atmosphere of doubt and fear...
Weekend Reading: Abraham Lincoln (December 3, 1861): First State of the Union Message: "It continues to develop that the insurrection is largely, if not exclusively, a war upon the first principle of popular government--the rights of the people...
So I woke up this morning bright and early ready to work... and I promptly let myself get distracted and procrastinated for an hour tracing links from Noah Smith's denunciation of Karl Marx:
Noah Smith: Remember Karl Marx for the many things he got wrong: "Marx didn’t make it to 200, but the ideas he injected into the global conversation and the ideologies that bear his name far outlasted the German economist and philosopher...
I, of course, agree with Noah—he does cite me favorably, after all. And then I realized that I had never put my "Understanding Karl Marx" lecture slides up anywhere...
This is what I want when I call for a better class of DeLong Smackdowns! How do we think this looks not just nine years after my optimism in 2009 back at the end of the American century but five years after Matt wrote?:
Hoisted from the Archives: Matthew Yglesias (2013): May Day Marxism: Capitalism is looking pretty shabby: "DeLong reposted a very interesting 2009 talk... "Understanding Karl Marx"... that I would have enthusiastically endorsed in 2009 but which look weaker four years later...
May 10, 2018 at 05:57 AM in Economics: Health, Economics: History, Economics: Inequality, History, Moral Responsibility, Philosophy: Moral, Political Economy, Politics, Streams: (Monday) Smackdown Watch, Streams: (Tuesday) Hoisted from Archives, Streams: Cycle, Streams: Economics, Streams: Equitable Growth, Streams: Highlighted | Permalink | Comments (1)
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Gains from Trade: Is Comparative Advantage the Ideology of the Comparatively Advantaged?: Trade, technology, job losses, and globalization–and their effects on prosperity and political turmoil.
Chair: Rohinton Medhora
Speakers: Brad Delong, Nadia Garbellini, Kaveh Majlesi, Arjun Jayadev
Discussant: Joseph Stiglitz, Pia Malaney
Each time I do this I think there must be a way to do it better. But each time I fail to think of one...
Good ideas very welcome...
Do your arithmetic, Sheeple! 1500 generations since radiation from the horn of Africa is really very little indeed...
Thx to Wavelength and the very interesting micro.blog http://help.micro.blog/2018/microcasting/ http://delong.micro.blog/2018/04/15/the-lets-be.html
Definitely Not My Morning Coffee: Ars Technica Live: Annalee Newitz and Brad DeLong: The Tech Boom and the Fate of Democracy "Ars Technica Live #21... Filmed by Chris Schodt, produced by Justin Wolfson...
Annalee writes: "Last week, we had lots of questions about the fate of democracy in a world where the Internet feeds us propaganda faster than we can fact check it...
Whether American growth was much faster because of slavery is a third order issue in the history of slavery. Nevertheless, it is one I talk about because I know something about it. I think that the overwhelming beneficiaries from slavery were slaveowners and the consumers of slave-produced goods, not those of us further down the timeline who would have benefited from faster economic growth.
Thx to Wavelength and the very interesting micro.blog http://help.micro.blog/2018/microcasting/ http://delong.micro.blog/2018/04/15/do-we-really.html
Wednesday night at Ars Technica LIVE! at Eli's Mile High Club in Oakland—located beneath where the eight-lane Interstate 580 crosses the ten-lane California Highway 24—there were three demands from the People of the Internet Appearing in Meatspace for a return of the Morning Coffee podcast.
So why not?
Globalization: What Did Krugman Miss?: DeLong Morning Coffee Podcast:
Paul Krugman has a very nice short “framework for thinking about globalization and the world” piece derived from a talk he gave at the IMF last fall.
I’m Brad Delong I’m chief economist here at the Blum Center and a professor in the Economics Department. I’m incredibly happy here to have Brink Lindsey and Steve Teles, authors of The Captured Economy: How the Powerful Enrich Themselves, Slow Down Growth, and Increase Inequality https://tinyurl.com/dl20180402b.
How this will work: I’m going to give a short introduction. Then Brink and Steve are going to present their show for fifteen or twenty minutes. Then we have three discussants who will take another twenty minutes.
We have Tom Mann, who was a long time fell senior fellow at the Brookings Institution, and is now a refugee out here in California, sitting at the Institute of Governmental Studies. He is the author of books with titles like:
We have Joseph Lough, who teaches history of economic thought and other things in the Economics Department, who is the author of Weber and the Persistence of Religion: Social Theory, Capitalism and the Sublime.
We have Rakesh Bhandari, who runs ISF, and the works of his I value most are “The Disguises of Wage Labour”, “Historical Materialism: On Luxury Spending in Science and Society”; and “On the Critique of Marcuse's One-Dimensional Man”.
Following that the authors will attack the discussants for misrepresenting their argument, and the discussants will attack the authors for misrepresenting their book.
Following that we will have questions—via Twitter. Hashtag #CapturedEconomyBlum. This is an innovation of the very sharp Josh Barro. Taking questions via Twitter and screening them means that (a) questions are asked, and (b) the questions asked are less than 280 characters.
Following that we will have our reception.
“The best attempt so far at a social democratic–libertarian synthesis of the origins and cure of our current political-economic ills…”—Brad DeLong
Niskanen Center: https://niskanencenter.org
Live from the Antebellum Plantation: Brian Fennessy: "Gavin Wright keeping the slave-capitalism debate lively: slavery was profitable to slaveholders but it kept the region underdeveloped and claims about its centrality to US Econ growth are exaggerated! #DukeMonumentsSymposium...
Do We Really Care Whether the Profits from American Slavery Were Reinvested to Spur Faster American Economic Growth or Not?
Brian Fennesey: "Gavin Wright keeping the slave-capitalism debate lively: Slavery was profitable to slaveholders but it kept the region underdeveloped and claims about its centrality to US economic growth are exaggerated! #DukeMonumentsSymposium...
I will be very interested in finding out!
Annalee Newitz: The tech boom and the fate of democracy: Wed, Apr 11, 2018 at 7:00 PM | Eli's Mile High Club, 3629 Martin Luther King Junior Way, Oakland, CA 94609: "Right now the U.S. tech economy is booming, but what will be the long-term effects of automation and AI?...
Professor DeLong Says Tax Bill Has 70% Chance of Passing | Bloomberg Daybreak Asia 2017-12-01
Professor DeLong Says Tax Bill Has 70% Chance of Passing: From 2017-12-01: Not a transcript but much more what I wish I had said—that is, heavily edited and revised to increase clarity, decrease stupidity, and file a little bit of the ragged stream-of-consciousness rough edges off.
Nevertheless, holds up very nicely, no? (BTW, this is my angry face):
This is a very nice short framework-for-thinking-about-globalization-and-the-world piece by Paul Krugman: Paul Krugman (2018): Globalization: What Did We Miss?
It is excellently written. It contains a number of important insights.
I have, unusually, a number of complaints about it. I will make them stridently:
March 23, 2018 at 11:40 AM in Economics: Growth, Economics: History, Economics: Inequality, Economics: Macro, Philosophy: Moral, Political Economy, Politics, Streams: (BiWeekly) Honest Broker, Streams: Cycle, Streams: Economics, Streams: Equitable Growth, Streams: Highlighted | Permalink | Comments (17)
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Asked at: Berkeley Haas School Center for Responsible Business 2018 Microsoft Conference on Business, Technology, and Human Rights: The Future of Work: I think I understand why previous waves of technology have boosted the employment and wages of unskilled workers. It is because “unskilled” human work is a very hard AI problem. Thus enormous numbers of jobs have been created for humans—jobs that are in a sense drudgery, but necessary drudgery:
Franklin Delano Roosevelt (March 4, 1933): I am certain that my fellow Americans expect that on my induction into the Presidency I will address them with a candor and a decision which the present situation of our Nation impels...
March 13, 2018 at 05:20 AM in Economics: Growth, Economics: Inequality, Economics: Macro, History, Moral Responsibility, Philosophy: Moral, Political Economy, Politics, Streams: Across the Wide Missouri, Streams: Economics, Streams: Equitable Growth, Twentieth Century Economic History | Permalink | Comments (0)
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Who profited from North American slavery before the Civil War?
Ask a historian, or a political scientist, or a politician the question, “Who benefited from North American slavery?” and the answer you will probably get is, “The slaveholders, of course. The slaveholders got to work their slaves hard, pay them little, sell what they made for healthy prices, and get rich."
We economists have a different view...
Document: Teddy Roosevelt (1907): Address of President Roosevelt on the occasion of the laying of the corner stone of the Pilgrim memorial monument https://www.icloud.com/keynote/0Ygwj9sjmrS-tI0aypbStC40A: "We can not as a nation be too profoundly grateful for the fact that the Puritan has stamped his influence so deeply on our national life. We need have but scant patience with the men who now rail at the Puritan's faults. They were evident, of course, for it is a quality of strong natures that their failings, like their virtues, should stand out in bold relief; but there is nothing easier than to belittle the great men of the past by dwelling only on the points where they come short of the universally recognized standards of the present...
March 06, 2018 at 10:48 AM in Economics: History, Economics: Inequality, Economics: Information, History, Moral Responsibility, Philosophy: Moral, Political Economy, Politics, Streams: (Wednesday) Economic History, Streams: Cycle, Streams: Economics, Streams: Equitable Growth, Twentieth Century Economic History | Permalink | Comments (4)
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Live from the Gilded Age: Andrew Carnegie (1889): Wealth: "The problem of our age is the proper administration of wealth...
Live from American History: Abigail Adams (31 March - 5 April 1776): Letter to John Adams, : "Braintree March 31, 1776...
The highly estimable Tim Taylor wrote:
Tim Taylor: Some Thoughts About Economic Exposition in Math and Words: "[Paul Romer's] notion that math is 'both more precise and more opaque' than words is an insight worth keeping..."
And he recommends Alfred Marshall's workflow checklist:
This is sage advice.
And to underscore the importance of this advice, I think it is time to hoist the best example I have seen in a while of people with no knowledge of the economics and no control over their models using—simple—math to be idiots: Per Krusell and Tony Smith trying and failing to criticize Thomas Piketty:
Donald Trump Is Playing to Lose: Donald Trump is certainly a very different kind of president from what we have been used to—not just in temperament; in (lack of) knowledge about America, its government, and the world; and in public presentation-of-self. He is very different from what we have been used to in his orientation toward policy as well.
Live at Project Syndicate: Donald Trump Is Playing to Lose: America certainly has a different kind of president than what it is used to. What distinguishes Donald Trump from his predecessors is not just his temperament and generalized ignorance, but also his approach to policymaking. Consider Bill Clinton, who in 1992 was, like Trump, elected without a majority of voters. Once in office, Clinton appealed to the left with fiscal-stimulus and health-care bills (both unsuccessful), but also tacked center with a pro-growth deficit-reduction bill. He appealed to the center right by concluding the North American Free Trade Agreement (NAFTA), which had been conceived under his Republican predecessors; and by signing a major crime bill. And he reappointed the conservative stalwart Alan Greenspan to chair the US Federal Reserve. Clinton hoped to achieve three things with this “triangulation” strategy... READ MOAR at Project Syndicate
*Milken Institute Review: When Globalization is Public Enemy Number One: The first 30 years after World War II saw the recovery and reintegration of the world economy (the “Thirty Glorious Years,” in the words of French economist Jean Fourastié). Yet after a troubled decade — one in which oil shocks, inflation, near-depression and asset bubbles temporarily left us demoralized — the subsequent 23 years (1984-2007) of perky growth and stable prices were even more impressive as far as the growth of the world's median income were concerned.
February 11, 2018 at 08:51 AM in Economics: Growth, Economics: History, Economics: Inequality, Economics: Macro, History, Philosophy: Moral, Political Economy, Politics, Streams: (BiWeekly) Honest Broker, Streams: Cycle, Streams: Economics, Streams: Equitable Growth, Streams: Highlighted | Permalink | Comments (1)
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Should-Read: The dominance of Malthusian factors and pressures in economists' minds up until the late nineteenth century: John Stuart Mill (1848, 1871): Principles of Political Economy: "Hitherto it is questionable if all the mechanical inventions yet made have lightened the day's toil of any human being...
Reading Question/Note Files for Bob Allen: Global Economic History: A Very Short Introduction:
Robert Allen: Global Economic History: A Very Short Introduction (0199596654):
Amici Curiae in Janus v. AFSCME: No. 16-1466 :: In the Supreme Court of the United States :: MARK JANUS, Petitioner, v. AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES, COUNCIL 31, ET AL., Respondents. On Writ of Certiorari to the United States Court of Appeals for the Seventh Circuit:
Henry J. Aaron, Katharine G. Abraham, Daron Acemoglu, David Autor, Ian Ayres, Alan S. Blinder, David Card, Kenneth G. Dau-Schmidt, Angus Stewart Deaton, Bradford DeLong, John J. Donohue III, Ronald G. Ehrenberg, Henry S. Farber, Robert H. Frank, Richard B. Freeman, Claudia Goldin, Robert J. Gordon, Oliver Hart, David A. Hoffman, Lawrence F. Katz, Thomas A. Kochan, Alan Krueger, David Lewin, Ray Marshall, Alexandre Mas, Eric S. Maskin, Alison D. Morantz, J.J. Prescott, Jesse Rothstein, Cecilia Elena Rouse, Jeffrey D. Sachs, Stewart J. Schwab, J.H. Verkerke, Paula B. Voos, David Weil: BRIEF OF AMICI CURIAE ECONOMISTS AND PROFESSORS OF LAW AND ECONOMICS IN SUPPORT OF RESPONDENTS:
Ken Murphy asked me for three books for 2017. Mine are: Amy Goldstein: Janesville: An American Story, Jean Tirole: Economics for the Common Good, and James Kwak: Economism: Bad Economics and the Rise of Inequality:
Alan Cole: @AlanMCole on Twitter: "Don't think this one's gonna pay for itself, guys:"
Susan Collins on Meet the Press, December 4, 2017:
SUSAN COLLINS: Apply [that] to [the] four-tenths of one percent increase in the GDP generates revenues of a trillion dollars, a trillion dollars.... I’ve talked four economists, including the Dean of the Columbia School of Business and former chairs of the councils of economic advisors and they believe that it will have this impact. So I think if we can stimulate the economy, create more jobs, that does generate more revenue...
OK. It appears likely that you will “win” this round. It appears more likely than not that the tax “reform“ bill will pass, and thus that you will redistribute an extra 0.5 percent of national income from the bottom 90% to your 0.1%-0.01%—depending on how exclusively you define yourselves—selves. That will move your share of America’s resources devoted to satisfying your desires up to 5-10%, from a baseline of back in the 1970s of 1.5-3%.
Charlie Deist: Brad DeLong on Austrian Economics:
Charlie Deist: Good morning everyone, and welcome to the Bob Zadek Show.
Should-Read: I say it is time to promote this guy to Admiral: AdmiralPAYGO!: Ed Lorenzen: @CaptainPAYGO on Twitter: "The Treasury Department dynamic 'analysis' of tax reform makes a mockery of dynamic analysis and does a disservice to those who advocate for serious dynamic estimates https://t.co/PudiRrQzu1..."
Brad DeLong: @de1ong on Twitter: This is a surprise? Static analysis was always about making a bias-variance tradeoff: A static analysis would be biased, but have lower mean-squared error because the "dynamic" terms would inevitably be overwhelmingly large-magnitude political-partisan-lobbyist-ideologue noise:
Hoisted from the Archives from 2015: Night Thoughts on Dynamic Scoring: Live from DuPont Circle: Last Thursday two of the smartest participants at the Brookings Panel on Economic Activity conference—Martin Feldstein and Glenn Hubbard—claimed marvelous things from the enactment of JEB!'s proposed tax cuts and his regulatory reform program. They claimed:
December 11, 2017 at 01:04 PM in Economics: Finance, Economics: Growth, Economics: Inequality, Moral Responsibility, Political Economy, Politics, Streams: (Tuesday) Hoisted from Archives, Streams: Cycle, Streams: Economics, Streams: Equitable Growth, Streams: Highlighted | Permalink | Comments (1)
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Losing friends on Twitter: What can I do here? What should I have done differently?
It is a matter of basic empirical historical fact that to a typical upper class white Virginian in the 1950s, "individual liberty" included, as principal and basic parts, the liberties:
Empirical fact. Historical fact. A seamless web of "individual liberty". These were among its principal components.
To deny that these were (a large) part of what "individual liberty" meant to a typical upper class white Virginian in the 1950s—to claim that you need "textual evidence" proving that this was how any particular one thought, for the "belief" that this was the case is a "slender reed"—that is a truly remarkable hill to choose to die on:
Joseph Britt: @zathras3 on Twitter:Thread by @de1ong in response to an observation I made about @SenBobCorker & the Senate #TaxBill-it understates resources available to a senior Senator, but is dead accurate on damage to the Senate done by McConnell trashing Regular Order.
Another day passes without any of the Unprofessional Republican Economists—not the nine, not the three, not the hundred-odd—with the exception of Jagdish Bhagwati—even emitting a peep about how the tax "reform" bill will not, in fact, pay for itself, and will raise the national debt above the appropriate counterfactual baseline...
It is worth reiterating just how unprofessional this has been. The authors take the following logical steps in constructing their argument:
Looking Forward to Four Years During Which Most if Not All of America's Potential for Human Progress Is Likely to Be Wasted
With each passing day Donald Trump looks more and more like Silvio Berlusconi: bunga-bunga governance, with a number of unlikely and unforeseen disasters and a major drag on the country--except in states where his policies are neutralized.
Nevertheless, remember: WE ARE WITH HER!
The purpose of this weblog is to be the best possible portal into what I am thinking, what I am reading, what I think about what I am reading, and what other smart people think about what I am reading...
"Bring expertise, bring a willingness to learn, bring good humor, bring a desire to improve the world—and also bring a low tolerance for lies and bullshit..." — Brad DeLong
"I have never subscribed to the notion that someone can unilaterally impose an obligation of confidentiality onto me simply by sending me an unsolicited letter—or an email..." — Patrick Nielsen Hayden
"I can safely say that I have learned more than I ever would have imagined doing this.... I also have a much better sense of how the public views what we do. Every economist should have to sell ideas to the public once in awhile and listen to what they say. There's a lot to learn..." — Mark Thoma
"Tone, engagement, cooperation, taking an interest in what others are saying, how the other commenters are reacting, the overall health of the conversation, and whether you're being a bore..." — Teresa Nielsen Hayden
"With the arrival of Web logging... my invisible college is paradise squared, for an academic at least. Plus, web logging is an excellent procrastination tool.... Plus, every legitimate economist who has worked in government has left swearing to do everything possible to raise the level of debate and to communicate with a mass audience.... Web logging is a promising way to do that..." — Brad DeLong
"Blogs are an outlet for unexpurgated, unreviewed, and occasionally unprofessional musings.... At Chicago, I found that some of my colleagues overestimated the time and effort I put into my blog—which led them to overestimate lost opportunities for scholarship. Other colleagues maintained that they never read blogs—and yet, without fail, they come into my office once every two weeks to talk about a post of mine..." — Daniel Drezner
"I now know it is a rising, not a setting, sun" --Benjamin Franklin, 1787
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